The showdown over beer sales in Whiteclay headed to the state's high court Monday.

Lawyers from both sides argued whether state regulators had the authority to deny the renewal of licenses to four beer outlets because of inadequate law enforcement.

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In late April, the unanimous decision by the Nebraska Liquor Control Commission temporarily ended beer sales in the unincorporated town of about a dozen residents that borders the Pine Ridge Indian reservation in South Dakota where alcohol is banned.

"The commissions decision was such a blatant violation of its authority," the attorney representing the beer store owners, Andrew Snyder, told Nebraska Supreme Court justices.

Snyder said adequate law enforcement is only a requirement for a new application.

He said the Supreme Court has previously ruled existing licenses are automatically renewed unless the license holder is no longer qualified, the location has change or the site is unsuitable for the sale of alcohol.

"None of that happen in this case whatsoever," Snyder said.

"That argument would mean that as long as you had the three things in your original application you could never be deprived of your liquor license," asked Justice John Wright.

"That's what this court has held," Snyder said.

But the attorney representing the Liquor Control Commission, argued the commission does have the authority.

"That the statutory renewal privilege quote shall not be construed as a vested right, which in any case prevent the commission from reducing the number of licenses to be issued within its jurisdiction," said James Smith, solicitor general from the Nebraska Attorney Generals Office.

Dave Domina, the attorney representing four Sheridan County residents who formally protested the beer licenses, said there were fatal flaws in liquor stores appeal to the courts.

"No summons to the Attorney General and no service. No naming of the citizens and no service. No record before the agency when the district court decided this case on it's merits without that record," Domina said.

"The beer stores are 0 for 5. None of those things appear in the record."

During the 40-minute hearing, justices asked the attorneys on both sides a number of questions on administrative procedure law and interpretation of previous court decisions.

Afterwards both side said they are optimistic.

"The court hit all the issues I expected them to," Snyder said.

"I am very confident that Whiteclay will never open up again. And I'm leaving here very positive," said former Lakota Sioux president Brian Brewer.

A decision from the Supreme Court is expected in the next two months.

The four beer stores still have 22 counts of liquor violations, including bootlegging allegations that are pending.

The Liquor Control Commission has yet to set a hearing date for those violations.